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The trade-enhancing effect of immigration networks: New evidence on the role of geographic proximity

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  • Artal-Tur, Andrés
  • Pallardó-López, Vicente J.
  • Requena-Silvente, Francisco

Abstract

We use migration-trade data from Italian, Portuguese and Spanish provinces to examine the importance of geographic proximity in the effectiveness of ethnic networks on bilateral trade. Empirical findings from the gravity model show that the migration-trade link is clearly in-province: exports from a province to a country do not receive any stimuli from immigrants from this country living outside of the province, once we control for country–province time-invariant fixed effects.

Suggested Citation

  • Artal-Tur, Andrés & Pallardó-López, Vicente J. & Requena-Silvente, Francisco, 2012. "The trade-enhancing effect of immigration networks: New evidence on the role of geographic proximity," Economics Letters, Elsevier, vol. 116(3), pages 554-557.
  • Handle: RePEc:eee:ecolet:v:116:y:2012:i:3:p:554-557 DOI: 10.1016/j.econlet.2012.05.046
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    References listed on IDEAS

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    1. Murat Genc & Masood Gheasi & Peter Nijkamp & Jacques Poot, 2012. "The impact of immigration on international trade: a meta-analysis," Chapters,in: Migration Impact Assessment, chapter 9, pages 301-337 Edward Elgar Publishing.
    2. Thomas Chaney, 2008. "Distorted Gravity: The Intensive and Extensive Margins of International Trade," American Economic Review, American Economic Association, vol. 98(4), pages 1707-1721, September.
    3. Anthony Briant & Pierre-Philippe Combes & Miren Lafourcade, 2014. "Product Complexity, Quality of Institutions and the Protrade Effect of Immigrants," The World Economy, Wiley Blackwell, vol. 37(1), pages 63-85, January.
    4. Giovanni Peri & Francisco Requena-Silvente, 2010. "The trade creation effect of immigrants: evidence from the remarkable case of Spain," Canadian Journal of Economics, Canadian Economics Association, vol. 43(4), pages 1433-1459, November.
    5. Mayer, Thierry & Zignago, Soledad, 2006. "Notes on CEPII’s distances measures," MPRA Paper 26469, University Library of Munich, Germany.
    6. Bedassa Tadesse & Roger White, 2010. "Cultural distance as a determinant of bilateral trade flows: do immigrants counter the effect of cultural differences?," Applied Economics Letters, Taylor & Francis Journals, vol. 17(2), pages 147-152, January.
    7. Wagner, Don & Head, Keith & Ries, John, 2002. "Immigration and the Trade of Provinces," Scottish Journal of Political Economy, Scottish Economic Society, vol. 49(5), pages 507-525, December.
    8. Faqin Lin, 2011. "The pro-trade impacts of immigrants: a meta-analysis of network effects," Journal of Chinese Economic and Foreign Trade Studies, Emerald Group Publishing, vol. 4(1), pages 17-27, February.
    9. Mark G. Herander & Luz A. Saavedra, 2005. "Exports and the Structure of Immigrant-Based Networks: The Role of Geographic Proximity," The Review of Economics and Statistics, MIT Press, vol. 87(2), pages 323-335, May.
    10. James E. Rauch, 2001. "Business and Social Networks in International Trade," Journal of Economic Literature, American Economic Association, vol. 39(4), pages 1177-1203, December.
    11. James E. Rauch & Vitor Trindade, 2002. "Ethnic Chinese Networks In International Trade," The Review of Economics and Statistics, MIT Press, vol. 84(1), pages 116-130, February.
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    Citations

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    Cited by:

    1. Massimiliano Bratti & Luca Benedictis & Gianluca Santoni, 2014. "On the pro-trade effects of immigrants," Review of World Economics (Weltwirtschaftliches Archiv), Springer;Institut für Weltwirtschaft (Kiel Institute for the World Economy), vol. 150(3), pages 557-594, August.
    2. Andreas Hatzigeorgiou & Magnus Lodefalk, 2015. "Trade, Migration and Integration – Evidence and Policy Implications," The World Economy, Wiley Blackwell, vol. 38(12), pages 2013-2048, December.
    3. Magnus Lodefalk, 2016. "Temporary expats for exports: micro-level evidence," Review of World Economics (Weltwirtschaftliches Archiv), Springer;Institut für Weltwirtschaft (Kiel Institute for the World Economy), vol. 152(4), pages 733-772, November.
    4. Serrano-Domingo, Guadalupe & Requena-Silvente, Francisco, 2013. "Re-examining the migration–trade link using province data: An application of the generalized propensity score," Economic Modelling, Elsevier, vol. 32(C), pages 247-261.
    5. Murat Genç, 2014. "The impact of migration on trade," IZA World of Labor, Institute for the Study of Labor (IZA), pages 1-82, June.
    6. Christopher R. Parsons & L. Alan Winters, 2014. "International migration, trade and aid: a survey," Chapters,in: International Handbook on Migration and Economic Development, chapter 4, pages 65-112 Edward Elgar Publishing.
    7. Ghosh, Sucharita & Enami, Ali, 2015. "Do refugee-immigrants affect international trade? Evidence from the world's largest refugee case," Journal of Policy Modeling, Elsevier, vol. 37(2), pages 291-307.
    8. Michael Good, 2013. "Geographic Proximity and the Pro-trade Effect of Migration: State-level Evidence from Mexican Migrants in the United States," 2013 Papers pgo530, Job Market Papers.
    9. Riccardo Fiorentini & Alina Verashchagina, 2017. "Immigration and Trade: The Case Study of Veneto Region in Italy," Working Papers 03/2017, University of Verona, Department of Economics.
    10. Robert E.B. Lucas, 2014. "The migration–trade link in developing economies: a summary and extension of evidence," Chapters,in: International Handbook on Migration and Economic Development, chapter 11, pages 288-326 Edward Elgar Publishing.

    More about this item

    Keywords

    Province-level exports; Immigration; Ethnic networks; Gravity;

    JEL classification:

    • C23 - Mathematical and Quantitative Methods - - Single Equation Models; Single Variables - - - Models with Panel Data; Spatio-temporal Models
    • F22 - International Economics - - International Factor Movements and International Business - - - International Migration
    • O24 - Economic Development, Innovation, Technological Change, and Growth - - Development Planning and Policy - - - Trade Policy; Factor Movement; Foreign Exchange Policy

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